Anand Cine Services Pvt. Ltd. Vs ACIT (Madras High Court)
The Madras High Court considered a challenge to a notice dated 28.03.2018 issued under Section 148 of the Income-tax Act, 1961, the consequential reassessment proceedings, the speaking order dated 30.08.2021, the directions issued under Section 144A, and the assessment order dated 31.03.2022 for AY 2013-14. The petitioner had originally filed its return, which was scrutinised and culminated in an assessment order dated 28.03.2016. A rectification application was filed on 07.04.2016. Thereafter, the assessment was reopened under Section 148. Upon the petitioner’s request, the reasons for reopening were furnished by communication dated 09.05.2018. The recorded reason was that land valued at ₹86,93,77,010 had been deleted from the fixed assets in the balance sheet without offering capital gains for assessment.
The petitioner objected to the reopening on the grounds that all relevant documents had already been furnished during the original assessment, that the reopening was based on a change of opinion, and that there was no tangible material. After an earlier order of the High Court directing the respondents to pass a speaking order in accordance with GKN Driveshafts Ltd. v. Income-tax Officer, the respondents issued the speaking order and subsequently passed an assessment order making aggregate additions of ₹1,49,93,830 under various heads. However, the assessment order specifically recorded that no addition was made in respect of the transaction that formed the basis for reopening because no short-term capital gain arose.
